Firm seeks Bausch & Lomb IPO after private sale fails to materialize

The owners of the well-known eye care products company Bausch & Lomb are considering an Initial Public Offering of the company after attempts to sell it privately did not meet expectations.

Bloomberg broke news at the end of last week that Warburg Pincus LLP is in talks with several nationwide banks discussing an IPO of the company which deals mostly in contact lenses and eye solution products. Warburg had been seeking at least $10 billion when it offered the company for sale privately but did not receive an offer topping $9 billion, the source notes quoting several unnamed sources.

The banks believed to be contacted by Warburg to hear its IPO pitch for Bausch & Lomb were Bank of America Corp., Citigroup Inc., Credit Suisse Group AG, and JPMorgan Chase. None would comment on the reported prospective IPO to Bloomberg for the report.

Warburg purchased Bausch & Lomb in 2007 for $4.6 billion – putting forward just $1.7 billion in equity – and despite legal trouble, the firm expects to bet back 200 percent of its investment with its sale. While some leading pharmaceutical companies where believed to be interested in purchasing Bausch & Lomb, none bit on the sought-after price from Warburg. Bloomberg reports that Abbott Laboratories, Johnson & Johnson, and Sanofi were all interested in purchasing the company but did not meet Warburg’s price.

Bausch & Lomb is currently facing legal trouble over its Renu MoistureLoc contact lens solution which was recalled by the company in 2006 after it was linked to an outbreak of Fusarium keratitis, an inflammation of the cornea that could cause blindness. Litigation is currently pending against the company in a lawsuit brought forward by the national law firm of Parker Waichman LLP in New York Supreme Court.

The company is now considering an IPO on Bausch & Lomb and is likely encouraged by the recent introduction of Pfizer’s Zoetis Inc., an animal-health care company. That company raised $2.57 billion in its IPO and has been gaining during its time on the market. Warburg is reportedly seeking a new fund “that documents obtained by Bloomberg news show has a target of $12 billion,” the source reported Feb. 22.